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GB 53: Arrangements involving residential land: trusts
or “Special rules for trusts that own residential land and make certain changes”
You could also call this:

“How to calculate property value changes for interposed residential property”

This law talks about how to handle changes in the value of property when you’re figuring out your interposed residential property percentage. You need to be aware of this if you own property through another entity, like a company.

If there’s an increase or decrease in value that affects your calculation, you need to be careful. The law says you can’t use this change if it’s caused by something you did on purpose to avoid the rules about interest on certain land. You also can’t use it if it’s part of a plan to get around these rules.

If either of these situations happen, you have to ignore the change in value when you’re working out your interposed residential property percentage. This means you calculate it as if the value hadn’t changed.

The law is trying to make sure people don’t find sneaky ways to avoid the rules about interest on land. It wants to keep things fair for everyone.

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Next up: GB 53C: On-lending at lower rate

or “Rules for lending borrowed money at lower rates to connected people”
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Part G Avoidance and non-market transactions
Avoidance: specific: Arrangements involving residential land

GB 53BInterposed residential property percentage: increases or decreases in value

  1. This section applies when there is an increase or decrease in value that affects, or would affect the result of a calculation of a person’s interposed residential property percentage, defined in section DH 6 (Interposed residential property percentage), and the increase or decrease is—

  2. caused by an action or omission that has, or would have the purpose or effect of defeating the intent and application of subpart DH (Interest incurred in relation to certain land):
    1. produced by an arrangement that has a purpose or effect of defeating the intent and application of subpart DH.

      1. The effect of the increase or decrease in value on the calculation of a person’s interposed residential property percentage is ignored.

      Notes
      • Section GB 53B: inserted (with effect on 27 March 2021), on , by section 112 of the Taxation (Annual Rates for 2021–22, GST, and Remedial Matters) Act 2022 (2022 No 10).